DETROIT — Vertically integrated cannabis company Gage Growth Corp. has secured a $55 million senior secured term loan to support retail acquisitions in Michigan and provide working capital.
The company, which trades on the Canadian Securities Exchange and is in the process of being acquired by TerrAscend Corp. in a $545 million deal, announced the debt financing this week.
“This non-dilutive financing provides Gage with maximum flexibility to execute on near-term acquisition opportunities,” Gage CEO Fabian Monaco said in a statement.
The financing round was led by Chicago Atlantic Advisors LLC and included a “high-quality mix of institutional investors,” Monaco added.
“Together with TerrAscend, we are committed to building one of the most dominant cannabis companies in Michigan. With the closing of this debt financing, we are well positioned to execute swiftly and drive value for our shareholders,” Monaco said.
Gage’s portfolio includes licenses for 19 commercial growing facilities, three processing facilities, and 15 dispensaries in Michigan. Ten of the dispensaries are currently in operation, including stores in Battle Creek, Traverse City, Lansing, Kalamazoo and Grand Rapids.
Gage’s growth plan, along with its $545 million deal with TerrAscend, is part of a wave of ongoing and expected M&A activity in Michigan’s cannabis sector, as Crain’s Detroit Business previously reported.
“Capitalism is very much alive in the cannabis space,” John Price, a vice president at global independent insurance brokerage Lockton Companies, said during an MiBiz roundtable in September. “The mergers and acquisitions will continue at a more rapid pace. The Gage acquisition, with wild multiples in their valuation, is the first domino to fall here.”